84 Mo. 27 | Mo. | 1884
Joseph Gf. Easton, LandonC. Easton and Henry C. Easton were partners in the business of banking at Hannibal, Missouri, under the firm name of ££ Joseph G. Easton & Co.” In March, 1877, Joseph died. The concern was largely in debt and had a large amount of assets. Henry C. Easton, as if it were necessary, applied to and received from the clerk of the probate court of that county, letters of administration, as surviving partner on the partnership estate. He gave the requisite bond as such surviving partner. He also gave notice by advertisement of his administration, requiring the creditors of said firm to exhibit to him, for allowance, within one year from the date of letters, demands,, against the estate, under penalty of being barred at the end of that time. Thereafter the creditors of the firm, including the appellants, from time to time; presented to said surviving partner their claims, and received a dividend of twenty per cent, on the principal. Afterwards the appellants presented their demands to the probate court for allowance and classification. The court allowed the same and classified them in the first and second classes respectively. The other creditors, of whom there were a large number, stood on the presentation of their demands to the survivor.
The administering partner made his second annual settlement with the probate court in May, 1879, and in July following, as such surviving partner, he presented to the probate court his petition for the sale of the real estate of the firm, to raise the necessary money to pay ofi the remaining debts of the estate. The court made the usual order of publication of notice of the application, as in case of an ordinary administration. On the return day of said notice the appellants appeared in the probate court and filed a motion to have the proposed order of sale so conditioned, that, after the payment of costs,
The sum of the propositions of law asserted by the ■appellants, is as follows: That under an administration by a surviving partner, demands against the partnership •estate should be presented to the court of probate for allowance and classification, as in the case of an ordinary ■administration of the estate of a deceased partner, and should be paid in the order of such classification, prc rata, and that the probate court has jurisdiction and the right to order the surviving partner to pay out of the proceeds of the sale of partnership real estate the demands allowed by the probate court in preference tc demands presented only to the surviving partner.
Other declarations of law were requested by the appellants, but as they all range themselves around these •central propositions, and depend upon their legal truth, it is not necessary to set them out in detail.
I. It is conceded that, at common law, jurisdiction •over matters of probate was vested largely in the eccle
In the statute of 1845 the legislature so far interposed as to require the survivor to give bond to the state, for the faithful and diligent performance of his duties, conferring on the respective county courts authority to cite him to account, and to adjudicate upon such account; and, also, gave to parties interested, a remedy on his bond' for misconduct or neglect, and imposed on him certain duties and acts towards the administrator or executor of the estate of the deceased partner. R. S. 1845, pp. 70, 71. In 1855 the legisla
And, as if to indicate that the innovations of the statute were not to be construed to interfere with the recognized common law right of the survivor to proceed to adjust and settle up the accounts and affairs, as also the liabilities of the firm, without any judicial ascertainment of such liabilities, the sixty-second section (Statutes 1855, page 124) declared: “In all cases, where the surviving partner administers upon the partnership effects, he shall have power to pay off demands against the partnership, without requiring the same to be exhibited for allowance to the county court; and such court shall allow such partner in his settlements, as credits, all demands which he may thus discharge, if it shall be satisfied of the justness of the demands; but, where such partner shall refuse to pay demands against the partnership, and where the administrator or executor of the deceased partner takes charge of the partnership effects, all such demands shall be exhibited to the county court for allowance and classification; and the
Prom the first clause, instead of taking away from the survivor his common law right to pay off demands, it is manifest that he may yet do so without any exhibition of them to the court for allowance, while from the second clause it is equally manifest that the right of a creditor of the firm to go to the probate court with his claim for allowance, is only where and when the survivor has refused to pay the demand after presentation to him, or where the survivor has failed to administer and give the required bond, and “the administrator or executor of the deceased partner takes charge of the partnership effects.” This, :t seems to me, was so palpable as not to have justified any adjudication to settle the proper construction. But the matter has been before this court and the court of appeals, and the above conclusion as to the act of 1855, expressly affirmed. State to use of Taylor v. Woods et al., 36 Mo. 73 ; Grow v. Weidner, 36 Mo. 412; Denny v. Turner, 2 Mo. App. 52. This section was carried forward into the revision of 1865, and Wagner’s Statiites of 1870, 1872, without any material change. W. S., p. 80, sec. 63. “Where a court of last resort construes a statute, and that statute is afterwards reenacted, or continued in force, without any change in its terms, it is presumed that the legislature adopted the construction given to it by the court.” Handlin v. Morgan Co., 57 Mo. 116.
By the very terms of this statute, it was a condition precedent to the right of the demandant to go before the probate court to have his claim allowed, that the administering survivor should have refused payment of the claim. That was in the nature of a jurisdictional fact, to be ascertained before the probate court had any authority to allow a claim, so long as the surviving partner was not displaced in the manner provided by statute. Leslie v. City of St. Louis, 47 Mo. 475 ; Ellis v. Pacific
As a logical sequence of the statutory recognition of the presentation of claims to the survivor for payment, is the tacit concession of his right to pass on their validity. Nor is there any justice in the denunciation of such a prerogative of the survivor. The common law rule was founded on the law of self-interest and self-pres
II. Without, in any wise, depreciating the very ingenious and elaborate argument made in this case by appellants’ counsel, much of it is lodged against theimpolicy of the law. That is a legislative, rather than a judicial question. We are not here to make, but to declare, the law. There being an administering survivor of the partnership estate in question, and no refusal by him to pay the claims of the appellants, the allowance and classification of the claims by the probate court were unauthorized, and gave these demandants no priority over the other creditors who had presented their demands to the survivor. The application to the probate court, by the surviving partner was for the sale of “certain partnership real estate,” and for that portion situated in Hannibal, the legal titledo which was in the name of all
Field, C. J., in Dupuy v. Leavenworth, 17 Cal. 262, very succinctly expresses the established rule of law: “In equity, real property acquired with partnership funds for partnership purposes is regarded as personal estate, so far as the payment of partnership debts and the adjustment of partnership rights are concerned. The real and beneficial interest which each partner possesses in the partnership property is the balance coming to him after the payment of the partnership debts, and the settlement of accounts with his co-partners. And, in the view of equity, it is immaterial in whose name the legal title of the property stands, whether in the individual name of one co-partner, or in the joint names of all; it is first subject to the payment of the partnership debts, and is then to be. distributed among the co-partners according to their respective rights. The possessor of the legal title in such case holds the estate in trust, for the purpose of the co-partnership. Each partner has an equitable interest in the property until such purposes are accomplished. Upon the dissolution of the co-partnership, by the death of one of its members, the surviving partner, who is charged with the duty of paying the debts, can dispose of this equitable interest, and the purchaser can compel the heirs-at-law of the deceased partner to perfect the purchase by conveyance of the legal title.”
In that case one of the partners eloped with the assets of the firm; after which the remaining partner, treating the partnership as dissolved by the death of one of its members, proceeded to sell the partnership real estate and execute deeds therefor. On the return of the absconding partner he (the absconding party) sold and conveyed his legal interest in the land to another party. The court held that the case was situated,
The Supreme Court of Tennessee go to the extent of holding, that the surviving partner takes the estate so absolutely that he may sell the realty and pass the title, whether the sale be demanded for the payment of the
If the survivor may obtain an order of probate to sell the interest of the deceased partner, which would, as claimed by those who contend for the proposition in question, have the effect to pass the whole estate, legal as well as equitable, of the heirs of the deceased partner, their interest might be unnecessarily sacrificed to pay the partnership debts. There is no power in the probate court to direct a joint sale of the interest of the deceased and the living partner, nor to order the living partner to join in the administrator’s deed. The only remedy, if any, left to the heirs of the decedent would be a resort to equity for contribution. We submit that such a circumlocutory procedure would little help the argument in favor of the theory of probate jurisdiction as asserted by appellant. • Under that theory the survivor would be subject to different jurisdictions in disposing of partnership property in payment of partnership debts. Whereas his deed, under the theory of this decision, conveying
Under the facts of this case we hold that the proceedings in the probate court- were unauthorized, and the judgment of the circuit- court should, therefore, be affirmed.